This is Lansner on Real Estate's seventh annual collection of outlooks on local real estate conditions.

Us: What will be two or three key managerial skills needed for the 2013 real estate market?

Jeff: My view is that 2013 will not require different managerial skills than over the past five years. In talking with area executives, there is still a significant level of uncertainty politically, and hence, will ultimately affect the business climate. The key to success then drives to a tight business plan with the ability to adapt quickly. One of my favorite terms is "to be ready for the 'opportunistic strike.'"

Us: What less-than-obvious indicators will you be watching in 2013 to sense what's next for real estate?Jeff: There are three industries that we spend a fair amount of time reviewing: (1) space utilization ratios, (2) shadow space, and (3) full floor availabilities. Given new technology providing workers the ability to work from home and the "gen Y" factor of open work space, we are seeing space utilization for the average Orange County office tenant move from north of 250 square feet per person to at or below 200 square feet per person. This trend is causing a reduction in demand for space, as well as a push for tenants to consider relocation as opposed to renewal. "Shadow space" is effectively vacant seats within a tenant's space that is under lease. Since we are entering the 5th year of a tough economy, most of the shadow space in the market has been transferred back to the landlords. Full vacant floors that are vacant have dropped by about 30 percent from the peak. Furthermore, from a large space perspective, there are still roughly 20 blocks of office space over 100,000 square feet, so we have a ways to go for real growth in rents.

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